Senior living has changed dramatically over the past decade or so. Today, there are more choices than ever before. There are also more options for financing senior living. If you’re like most families, you and your senior loved one have lots of questions about paying for senior living. We thought it would be helpful to answer a few of those we hear most often.

The Most Common Questions About Financing Senior Living Here are answers to some of the common questions families have about how to pay for senior living.

1. How do I pay for assisted living? Bridge Loans If your family has decided to sell your senior loved one’s home to pay for senior living, a bridge loan can help. This is a short-term loan that helps pay for assisted living until the home sells. In the meantime, there are senior living relocation specialists. They specialize in helping seniors sell their property when they’ve decided to move to senior living. Typically, these realtors belong to the Senior Real Estate Specialist Council, a national network of realtors who have special knowledge of the market. Rent the Home If your senior loved one isn’t ready to let go of their home, consider renting it. Rental payments can help cover the cost of senior living. An upside to this option is you don’t have to deal with selling the home before transitioning to senior living. Veterans’ Programs Veterans who are eligible to receive a VA pension may be eligible to receive benefits to help pay for assisted living. The Aid and Attendance Program is administered by the U.S. Department of Veterans Affairs. You can contact the regional office nearest you for more information.

2. Can we use a life insurance policy to pay for senior living? You can if you take advantage of what is called a ‘life settlement’. Here are some pros: -A large lump sum is issued to pay for home improvements, in-home care, or assisted/senior living -No restrictions on how funds are used -Life settlements can pay up to seven times more than the cash surrender value -You no longer have to make premium payments -There may be tax deductions available if used to pay for long-term care But there are also some drawbacks including: -This may disqualify you for Medicaid -The death benefit is transferred to the new owner of the policy -The settlement can be taxable as a capital gain -You may pay a broker fee (6% of the face value of the policy, for example) unless you try to sell it yourself -Your senior loved one may have to undergo a medical exam

3. Does long-term care (LTC) insurance cover assisted living? LTC insurance policies cover people who have chronic conditions or disabilities requiring them to seek help for the basics of daily living. Policies differ but may help pay for care at home, in an assisted living community, or in a long term care center. There a lot of factors to consider when it comes to using long-term care insurance to finance senior living. Pros of LTC: -Benefits may be used in a home setting, assisted living or a long-term care center -While they typically don’t cover the entire cost of care, LTC insurance can make care more affordable Cons of LTC: -Most policies have limits on how long and how much they’ll pay -Premiums can increase -If you become unable to afford the premiums, you could lose your investment -Can usually only be used to reimburse seniors for the cost of services for assistance with the activities of daily living (ADL) -Coverage is based on strict requirements for the assisted living community

4. What does senior living really cost? Monthly fees for assisted living across the country average $4,300, but that is just an average. Some areas of the country can be higher, and some will be lower. The good news is services and support can typically be customized. This a la carte system allows seniors who don’t need those services to opt out and pay lower fees. In other words, residents don’t have to pay for services they don’t want or need.

5. Does Medicare pay for assisted living? Unfortunately, it does not. And that is often a surprise to adult children. Because Medicare is a healthcare program, it only covers services determined to be medical in nature. A rehab center, a hospital stay or a physician appointment are examples of services covered by Medicare.

Want to Learn More? River Park Has Resources Call or visit River Park to learn more about paying for assisted living. We can help you explore the options available to you and your family.